Aid is no substitute for good government

By
Helena Cobban /
January 14, 1999

What should the west do if the hard-pressed central governments in countries like Indonesia or Russia collapse in on themselves? One good source of guidance in such crises is to review the record of Western intervention during the African "failed state" crises of the 1990s. Though the first thing westerners notice when states "fail" is economic consequences, these events are never purely economic. They always have, at root, a deep crisis of domestic governance. Look at how East Asian states weathered last year's economic woes. Though all suffered, Indonesia clearly suffered the most. It lost 30 percent of the value of its currency against the dollar; consumer prices soared 78 percent; by year-end, short-term interest rates had climbed to 41 percent. Meanwhile, Indonesians have been going through a long crisis of governance. The resignation of cold-war dinosaur President Suharto didn't solve the problem. Today, student demonstrators are pressing his successor, B.J. Habibie, also to step aside. Secessionist movements threaten to pull whole areas away from Jakarta's rule. With the collapse of jobs and family savings, several areas face extreme hardship, disease, and hunger. Is the answer, then, for outsiders to focus on humanitarian intervention? That was the main mechanism used in the past decade's crises in Africa. But in Africa, as in former Yugoslavia, a mainly humanitarian approach has brought no lasting solutions. Humanitarian aid can fill stomachs for a day, or a week, or a year. But it does not resolve the underlying problems which caused the hardship in the first place. Only the emergence of effective government, bolstered by political reconciliation and strong internal social compacts, can do this. "Neo-liberal" economic theories which question the role of central government have had only limited impact in the West, where organized constituencies have generally succeeded in protecting key social programs. But, when urged by Western financial institutions on poor countries of the third world, these theories have seriously undermined local states. Now, the thrust of Western intervention must be to help install effective governments that can provide security and basic infrastructure, with as much political accountability - to their own people - as possible. Humanitarian help, whether from the United Nations, Western governments, or nongovernmental groups, can undergird - but not substitute for - that process. And ill-considered or headline-driven humanitarian aid can, as happened too often in Africa, undercut local potentials rather than building them. If those lessons are important for a country like Indonesia, they're even more important for Russia, where consumer prices rose 66 percent in 1998, the ruble lost 73 percent of its value, and the stock market lost 95 percent of its dollar value. Once again, the key problem is a deep crisis of governance. In Moscow, the impeachment committee of the Duma has recommended impeachment of President Yeltsin on four of five charges. The fifth - still unproven - is "genocide against the Rus-sian people," by economic mismanagement. Despite those moves and Mr. Yeltsin's ill health, Prime Minister Yevgeny Primakov has clear political skills, and may be able to pull the country through the winter. But the deep challenge of building a stable post-Soviet political order will remain. Mr. Primakov may find useful lessons from India, whose leaders have built a regime based on some democracy and a rock-bottom social safety net, supported by broad public works programs. The Indians have managed, in 51 years of independence, to eradicate the famines that periodically swept the country under British rule. In terms of global stability, Russia, with its vast nuclear arsenal, is clearly more central than Indonesia. In the 1930s, the Germans showed what type of government any nation made hopeless through deprivation can vote into power. The West can't ignore the Russian crisis. But how are Western governments planning to respond? That is a much bigger issue than whether Bill Clinton or Al Gore is our president for the next two years. Helena Cobban writes on foreign affairs from Charlottesville, Va.